The Office of Foreign Assets Control (OFAC) Files Claims Against CoinList Markets
The Office of Foreign Assets Control (OFAC) of the United States Treasury Department has filed claims against CoinList Markets, a virtual currency exchange. The company has agreed to pay over $1.2 million to resolve the allegations.
CoinList Allowed Transactions Despite Sanctions
CoinList, based in San Francisco, allowed 989 transactions valued at over $1.3 million between April 2020 and May 2022. Despite sanctions imposed by the US against Russia for its seizure of Crimea, CoinList continued to execute transactions for clients in the Crimea area of Ukraine.
Flaw in CoinList’s System
OFAC discovered a significant flaw in CoinList’s system that failed to identify individuals claiming citizenship from non-embargoed countries but providing addresses in Crimea. The company was responsible for implementing sanctions compliance processes, including screening clients against sanctions lists.
Mitigating Considerations and Settlement
OFAC considered several mitigating factors when reaching a settlement with CoinList. The company had not received an OFAC notification in the five years prior to the first breach, agreed to cooperate with inquiries, and the transactions in violation were a small portion of total activity.
Suspension and Compliance Enhancements
CoinList will pay a settlement amount of $1.2 million and is expected to spend $300,000 on improving its compliance procedures. As part of the settlement agreement, CoinList will implement a suspension. While the settlement is significantly less than the maximum civil penalty, it reflects the non-egregious nature of the offenses.
CoinList’s Commitment to Compliance
CoinList, a relatively small trade with a daily volume of $350,000, is satisfied with the settlement. The company has pledged to make significant improvements to its compliance processes, control systems, and training to demonstrate its dedication to compliance.
Hot Take: CoinList Faces OFAC Claims for Violating Sanctions
The Office of Foreign Assets Control (OFAC) has taken action against CoinList Markets for allowing transactions in violation of US sanctions against Russia. Despite the sanctions, CoinList executed transactions for clients in Crimea. While the settlement amount of $1.2 million is less than the possible maximum civil penalty, CoinList will also spend $300,000 on enhancing its compliance procedures. The company’s commitment to compliance and cooperation with inquiries have been acknowledged by OFAC. This case highlights the importance of robust sanctions compliance processes in the cryptocurrency industry.
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